01—Abstract
Summary
Summary of the 8-K filed November 26, 2025. Cited figures are marked; the original filing is the authoritative source.
Deere & Company reported fourth-quarter fiscal 2025 net income attributable to the company of $1.065 billiona, or $3.93 per diluted share, down 14% from $1.245 billion ($4.55) a year earlier, even though worldwide net sales and revenues rose 11% to $12.394 billion.
For the full year, net income fell 29% to $5.027 billionb ($18.50 per share) on revenues down 12% to $45.684 billion. The headline quarterly revenue growth was driven by Construction & Forestry (+27%) and Production & Precision Ag (+10%) shipment volumes, while profitability was squeezed by tariffs, higher production costs, warranty expense, and special items. Small Ag & Turf operating margin collapsed to 1.0% from 10.1%, and Production & Precision Ag margin fell to 12.7% from 15.3%.
Management guided fiscal 2026 net income to $4.00c–4.75 billion and characterized 2026 as the likely bottom of the large ag cycle. The outlook calls for large ag in the U.S. and Canada to fall 15–20%, while small ag & turf and construction & forestry are expected to grow, with Production & Precision Ag net sales down 5–10% and Small Ag & Turf and Construction & Forestry each up about 10%.
Financial Services net income is forecast at roughly $830 milliond versus $890 million in fiscal 2025. Investors should weigh the improved segment mix and stabilization narrative against continued tariff pressure, a $95 million pretax litigation accrual in the quarter, and the company's ongoing FTC right-to-repair lawsuit.
02—Key points
Key Highlights
- Q4 FY2025 net income of $1.065B ($3.93/diluted share), down 14% YoY; net sales and revenues up 11% to $12.394B
- Full-year FY2025 net income of $5.027B ($18.50/share), down 29% YoY on revenues of $45.684B (-12%)
- FY2026 net income guidance of $4.00–4.75B, with management calling 2026 the bottom of the large ag cycle
- Small Ag & Turf Q4 operating margin fell to 1.0% from 10.1%, driven by tariffs, warranty expense, and production costs
- Construction & Forestry Q4 net sales rose 27% to $3.382B, with operating profit up 6% to $348M
- Special items in Q4 included a $95M pretax litigation accrual (antitrust class action), weighing on SA&G expenses
- FY2026 outlook: U.S. & Canada large ag down 15–20%; Production & Precision Ag sales down 5–10%; Small Ag & Turf and C&F up ~10%
03—Questions
Frequently Asked Questions
Why did net income fall even though revenue grew in the fourth quarter?
Revenue growth of 11% was driven by higher shipment volumes in Construction & Forestry and Production & Precision Ag, but operating profit declined. Higher tariffs, increased production costs, warranty expenses, and special items (including a $95M litigation accrual) more than offset the volume benefit, pushing diluted EPS down to $3.93 from $4.55.
What is the outlook for fiscal 2026?
Deere forecasts net income attributable to the company of $4.00–4.75B. Large ag in the U.S. and Canada is expected to decline 15–20%, and Production & Precision Ag net sales are forecast to fall 5–10% with a 11–13% operating margin. Small Ag & Turf and Construction & Forestry are each expected to grow about 10%, and Financial Services net income is projected at roughly $830M.
Are the tariffs and margin pressures expected to ease?
Management said ongoing margin pressure from tariffs and persistent large ag challenges remain. It is relying on inventory management, cost control, and growth in small ag and construction segments to offset this. The filing does not quantify a tariff relief timeline.
What were the notable special items and legal matters?
Q4 FY2025 included a $95M pretax ($75M after-tax) increase in accrued losses for a consolidated multidistrict antitrust class action. Full-year special items totaled $124M in expenses, offset partly by a $32M BJD measurement gain. The filing also references an FTC and five-state lawsuit alleging Deere unlawfully withheld self-repair capabilities.
How is the balance sheet and cash generation looking?
Consolidated cash and equivalents rose to $8.276B from $7.324B. Equipment operations net operating cash flow for fiscal 2025 was $5.100B, and the company guides FY2026 equipment operations operating cash flow to $4.0–5.0B. Share repurchases fell to $1.138B from $4.007B, while dividends declared rose to $6.48 per share from $5.88.
04—Continue